Correlation Between Western Mining and Zhongtong Guomai
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By analyzing existing cross correlation between Western Mining Co and Zhongtong Guomai Communication, you can compare the effects of market volatilities on Western Mining and Zhongtong Guomai and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Western Mining with a short position of Zhongtong Guomai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Mining and Zhongtong Guomai.
Diversification Opportunities for Western Mining and Zhongtong Guomai
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Western and Zhongtong is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Western Mining Co and Zhongtong Guomai Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongtong Guomai Com and Western Mining is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Western Mining Co are associated (or correlated) with Zhongtong Guomai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongtong Guomai Com has no effect on the direction of Western Mining i.e., Western Mining and Zhongtong Guomai go up and down completely randomly.
Pair Corralation between Western Mining and Zhongtong Guomai
Assuming the 90 days trading horizon Western Mining Co is expected to under-perform the Zhongtong Guomai. But the stock apears to be less risky and, when comparing its historical volatility, Western Mining Co is 2.44 times less risky than Zhongtong Guomai. The stock trades about -0.21 of its potential returns per unit of risk. The Zhongtong Guomai Communication is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,100 in Zhongtong Guomai Communication on September 2, 2024 and sell it today you would earn a total of 21.00 from holding Zhongtong Guomai Communication or generate 1.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Mining Co vs. Zhongtong Guomai Communication
Performance |
| Timeline |
| Western Mining |
| Zhongtong Guomai Com |
Western Mining and Zhongtong Guomai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Mining and Zhongtong Guomai
The main advantage of trading using opposite Western Mining and Zhongtong Guomai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Mining position performs unexpectedly, Zhongtong Guomai can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Zhongtong Guomai will offset losses from the drop in Zhongtong Guomai's long position.| Western Mining vs. Cultural Investment Holdings | Western Mining vs. JCHX Mining Management | Western Mining vs. Zoje Resources Investment | Western Mining vs. Zhejiang Construction Investment |
| Zhongtong Guomai vs. China Petroleum Chemical | Zhongtong Guomai vs. PetroChina Co Ltd | Zhongtong Guomai vs. China State Construction | Zhongtong Guomai vs. China Railway Group |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Commodity Directory module to find actively traded commodities issued by global exchanges.
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